As difficult as it might be to believe, we could be at the beginning of another decade-long bull market. When I started investing, in early 2010, almost nobody back then could believe that a bull market had already started.

Yet that long, slow burn lasted for more than 10 years. This one, though, coming off the pandemic-fueled crash last spring, is turning into a more explosive affair.

And that’s making it difficult to find great deals on great stocks. However, this extra challenge might just mean extra reward.

I’d know a lot about challenges and rewards. By challenging myself to live below my means and regularly invest in high-quality stocks, I was able to retire in my early 30s.

Dividend growth investing. This strategy espouses buying and holding shares in world-class enterprises paying reliable, rising dividends.

I built out the FIRE Fund using the tenets of this strategy. That’s my real-money dividend growth stock portfolio, and it produces enough five-figure dividend income for me to live off of.

This strategy is amazing. But it can be amplified by finding those great deals. Price is only what you pay, but value is what you actually get.

An undervalued dividend growth stock should provide a higher yield, greater long-term total return potential, and reduced risk. This is relative to what the same stock might otherwise provide if it were fairly valued or overvalued.

Price and yield are inversely correlated. All else equal, a lower price will result in a higher yield. That higher yield correlates to greater long-term total return potential.

This is because total return is simply the total income earned from an investment – capital gain plus investment income – over a period of time. Prospective investment income is boosted by the higher yield.

But capital gain is also given a possible boost via the “upside” between a lower price paid and higher estimated intrinsic value.

Bristol-Myers Squibb Co. (BMY) is a global biopharmaceutical company that is engaged in discovering, developing, and delivering a range of medicines to help people overcome serious diseases.

Founded in 1887, Bristol-Myers Squibb is now a $146 billion (by market cap) healthcare behemoth that employs 30,000 people.

The company focuses on oncology, cardiovascular, and immunology treatments.

Profitability is robust as it sits, but I suspect this will also look a lot better once things normalize.

Over the last five years, the firm has averaged annual net margin of 10.72% and annual return on equity of 16.07%.

Both numbers would be a lot higher if not for the skewing of GAAP numbers for FY 2020.

Overall, I think Bristol-Myers Squibb is more investable than it’s ever been.

The healthy pipeline, blockbuster drug lineup, and recent acceleration of growth all offer a lot to like.

Morningstar rates BMY as a 3-star stock, with a fair value estimate of $68.00.

CFRA is another professional analysis firm, and I like to compare my valuation opinion to theirs to see if I’m out of line.

They similarly rate stocks on a 1-5 star scale, with 1 star meaning a stock is a strong sell and 5 stars meaning a stock is a strong buy. 3 stars is a hold.

CFRA rates BMY as a 4-star “BUY”, with a 12-month target price of $72.00.

I came out right in the middle this time around. Averaging the three numbers out gives us a final valuation of $69.97, which would indicate the stock is possibly 8% undervalued.

Bottom line: Bristol-Myers Squibb Co. (BMY) is a high-quality biopharmaceutical company with one of the best-selling products in its entire industry. Huge long-term demographic tailwinds blow its way, further bolstering their prospects. With a market-beating dividend, accelerating dividend growth, a low payout ratio, more than a decade of dividend raises, and the potential that shares are 8% undervalued, this could be a rare deal in an expensive stock market.

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